Robert Mitchell
Arizona law permits commercial landlords to use self-help remedies, including lockouts, provided they can accomplish re-entry without breaching the peace. This self-help right is significant because it allows commercial landlords to regain possession immediately upon default without court proceedings, provided they can do so peacefully.
Please note that, while this article accurately describes applicable law on the subject covered at the time of its writing, the law continues to develop with the passage of time. Accordingly, before relying upon this article, care should be taken to verify that the law described herein has not changed.
I. Tenants’ Rights Upon Lockout.
Arizona’s commercial landlord-tenant statute grants landlords broad rights to terminate tenancies and regain possession without providing tenants any statutory cure or reinstatement rights. In other words, the tenant cannot reinstate the Lease. Under A.R.S. § 33-361(A):
“[w]hen a [commercial] tenant neglects or refuses to pay rent when due and in arrears for five days, or when a tenant violates any provision of the lease, the landlord or person to whom the rent is due, or the agent of the landlord or person to whom the rent is due, may reenter and take possession or, without formal demand or reentry, commence an action for recovery of possession of the premises.”
Critically, A.R.S. § 33-361 contains no provision allowing tenants to cure defaults or reinstate possession by tendering past-due amounts. The Arizona Supreme Court in DVM Co. v. Bricker, 137 Ariz. 589, 592 (App. 1983), confirmed that under A.R.S. § 33-361, there is no requirement that the breach be material for landlords to exercise termination rights. This stands in stark contrast to the protections afforded to residential tenants (see A.R.S. § 33-1368(B)) and demonstrates the statute’s landlord-favorable approach.
Arizona courts have not recognized any general right for commercial tenants to cure defaults through payment. In Premier Consulting and Management Solutions, LLC v. Peace Releaf Center I, 257 Ariz. 80, 88 (App. 2024), the court reaffirmed that “when a commercial tenant breaches its lease, Arizona law generally permits the landlord to terminate the tenant’s right to possession without terminating the lease itself,” citing Roosen v. Schaffer, 127 Ariz. 346, 349, 621 P.2d 33, 36 (App. 1980). The tenant remains obligated to pay rent for the full term of the lease subject only to the landlord’s duty to mitigate damages.
II. The Landlord’s Lien Under Arizona Law is Broad.
Under Arizona law, a landlord has a lien over a commercial tenant’s personal property left on the leased premises. A.R.S. §§ 33-361 and 33-362 establish comprehensive landlord lien rights that apply to both residential and commercial tenancies, granting landlords a statutory lien on tenant personal property located on the leased premises as security for unpaid rent. However, this lien is subject to specific requirements regarding the property’s location, ownership, and enforcement procedures.
Arizona’s landlord lien statutes provide broad authority for landlords to secure unpaid rent through liens on tenant property. Under A.R.S. § 33-362(A), “the landlord shall have a lien on all property of his tenant not exempt by law, placed upon or used on the leased premises, until the rent is paid.” This statutory lien attaches automatically and does not require any filing or perfection procedures, distinguishing it from other types of security interests.
The enforcement provision in A.R.S. § 33-361(D) authorizes landlords to take possession of tenant property when rent remains unpaid:
“If the tenant refuses or fails to pay rent owing and due, the landlord shall have a lien on and may seize as much personal property of the tenant located on the premises and not exempted by law as is necessary to secure payment of the rent.”
This provision establishes both the lien and the enforcement mechanism for commercial tenancies.
III. The Landlord’s Lien Applies Only to Specific Categories of Property that Meet Statutory Requirements.
First, the property must be placed upon or used on the leased premises, requiring a physical connection between the property and the rental location. A.R.S. § 33-362. The Arizona Court of Appeals recently clarified this requirement in PNC Bank, N.A. v. Coury, 257 Ariz. 52, 57 (App. 2024), holding that accounts receivable were not subject to landlord’s lien because they “cannot be located, found, seized, or used on leased premises,” and that the property must be physically present on leased premises when put to use.
Second, the property must belong to the tenant, not a third-party. A.R.S. § 33-362(B) specifically provides that “the property of any other person, although found on the premises, shall not be liable therefor.” See Bates & Springer of Arizona, Inc. v. Friermood, 109 Ariz. 203, 205-06 (App. 1973) (holding that television sets subject to trust receipts and used in the tenant’s business were not subject to landlord’s lien, because they belonged to third-parties).
Third, the property must not be exempt under state or federal law. A.R.S. § 33-361 (D).
IV. Priority of Landlord’s Liens
In Ex-Cell-O Corp. v. Lincor Properties of Arizona, the Arizona Court of Appeals held that the general rule is that a landlord’s lien attaches at the commencement of the tenancy or when the property is first brought on the leased premises. 158 Ariz. 307, 309 (1988). This early attachment can create priority conflicts with other security interests.
However, properly perfected security interests may take priority over landlord’s liens. In Ex-Cell-O Corp., the court ruled that a seller’s security interest in equipment had priority over the statutory landlord’s lien because the security interest was perfected before the equipment was brought onto the premises. Id. Thus, while landlord’s liens are powerful, they are not automatically superior to all other claims on tenant property.
V. Statutory Procedure for Enforcing Lien On Tenant’s Real Property.
Arizona law establishes specific procedural requirements for enforcing a landlord’s liens against tenant’s personal property. Under A.R.S. § 33-361(D), landlords must wait sixty days after seizure before selling the property:
“If the rent is not paid and satisfied within sixty days after seizure as provided for in this section, the landlord may sell the seized personal property in the manner provided by § 33-1023.”
The sale procedures set forth in A.R.S. § 33-1023 require additional notice and waiting periods. After charges accrue, the landlord must allow twenty days for payment, followed by ten days’ notice to pay (if the owner is in-county), and five days’ notice before the public auction sale. The statute requires advance notice of the sale itself:
“Five days’ notice of sale shall be given to the owner if he can be found, and if not, then by two publications in a newspaper published in the county.”
A.R.S. § 33-1023(B). The sale must be conducted at public auction, with proceeds applied first to the charges owed, and the remaining balance of the proceeds paid to the person entitled thereto. Id. at (A).
Arizona courts have also held that landlords retain lien rights even after a wrongful lease termination. In Janes v. Country Escrow Service, 135 Ariz. 231, 234 (App. 1982), the Arizona Court of Appeals ruled that even though landlord may have wrongfully terminated lease, landlord retained statutory right to seize tenant’s property pursuant to landlord’s lien and thus could not be liable for conversion. This protects landlord lien rights from being defeated by procedural disputes over lease termination.
VI. Return or Release of Tenants’ Property.
Under Arizona law, landlords must return or release specific categories of property to tenants, even when exercising landlord lien rights. The key property that must be returned includes exempt property under Arizona’s personal property exemption statutes and property belonging to third-parties.
For commercial tenants, A.R.S. § 33-1130 exempts business tools, equipment, instruments, and books primarily used in the debtor’s commercial activity up to $5,000 in aggregate value, plus farm machinery and implements up to $2,500 for farming operations.
In addition, the landlord lien statutes explicitly require the release of property belonging to persons other than the tenant. A.R.S. § 33-362(B) states, “the property of any other person, although found on the premises, shall not be liable [for rent].” This protection was reinforced in Bates & Springer of Arizona, Inc. v. Friermood, where the Arizona Supreme Court held that television sets subject to trust receipts were not subject to landlord’s lien because they belonged to third-parties. 109 Ariz. at 206.